US firm paid Rs 6 crore bribe for Goa, Guwahati projects

A New Jersey-based construction management firm, Louis Berger International Inc, has been charged with paying a little under $1 million (over 6 crore at current exchange rates) in bribes for projects in Goa and Guwahati, including to a minister, whose name has not been revealed in documents released by the US justice department.

TNN & Agencies | Updated: Jul 19, 2015, 03:55 IST

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US firm paid Rs 6 crore bribe ...

WASHINGTON/PANAJI/GUWAHATI: A New Jersey-based construction management firm, Louis Berger International Inc, has been charged with paying a little under $1 million (over 6 crore at current exchange rates) in bribes for projects in Goa and Guwahati, including to a minister, whose name has not been revealed in documents released by the US justice department. Louis Berger has admitted to violating the US Foreign Corrupt Practices Law.
On Friday, the firm admitted to involvement of its employees in bribe payments of $3.9 million between 1998 and 2010 in India, Indonesia, Kuwait and Vietnam, and decided to pay the $17.1 million penalty.

Former executives Richard Hirsch and James McClung pleaded guilty in a federal court in Trenton, New Jersey. Hirsch was a high-level executive based in the Philippines, who at times oversaw the company's operations in Indonesia and Vietnam. McClung was based in India and at times oversaw the operations in Vietnam and India. The sentencing for Hirsch
and McClung is scheduled for November.

The documents released by the justice department quoted an August 2010 email, sent by a consortium partner to McClung, stating: "As discussed I enclose the details as provided by (third-party intermediary.)"

The email stated, "I have also added the details of amounts paid to (the company) as of date by (the consortium partner) in the same sheet. The attachment included an entry, 'paid by (an agent of the company) to minister on behalf of agent'."

Further, the documents stated: "On or about August 26, 2010, a consortium partner prepared a payment tracking schedule stating that the company had paid $976,630 in bribes in connection with the Goa project to date."

The Indian government, assisted by Japan, initiated the five-year Goa Water Supply and Sewerage Project to expand, rehabilitate and build water and sewerage facilities. In India, the $1-billion firm has offices in Gurgaon, Mumbai and Hyderabad.

Officials in Goa said Louis Berger did not bid for the water and sewerage project, and it was only one of the partners of the consortium that was appointed the lead consultant.

But it has come to light that both the Congress and BJP governments had appointed the firm for two other projects—one of them the proposed Greenfield international airport at Mopa, for which it was the technical consultant.

A M Wachasunder, former PWD principal chief engineer and current project director of the JICA project, said the lead consultant was a Japanese consultant and Louis Berger was one of the partners. It was a consortium. Louis Berger did not bid but the Japanese company did. "They were not connected directly with the project. They were associated with the lead consultant, Nyan Siddo, for the JICA project," Wachasundar said. Siddo was the consultant for the project, he said.

STOI also spoke to then PWD minister Churchill Alemao during whose tenure the consultant was appointed for the JICA project. "I have been told of some story on the internet about some bribery charge. Frankly, I don't have any idea." To another question, he said, "Nobody had approached me for any deal."

In Assam, the consulting firm is looking after technical monitoring of the in-progress south central and north Guwahati water supply project to provide round-the-clock water supply to the residents of the city.

The Guwahati project that has been divided into two parts is being implemented with financial assistance from Japan International Cooperation Agency (JICA) and is likely to be completed by 2016. Experts from Louis Berger Company are helping in project management in Guwahati, said a senior Assam government official.

The new infrastructure, funded by JICA, will provide continuous, pressurized and potable water supply to all people living in south-central and north zones of Guwahati city, significantly improving current living standards. Louis Berger is providing project management consulting services to the Guwahati Metropolitan Development Authority (GMDA) throughout the project's lifecycle.

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